Starbucks(US:SBUX) 第一财经·2025-11-06 06:16Core Viewpoint - Starbucks has transitioned from "independent control" to "joint operation" in China, partnering with Boyu Capital to form a joint venture, marking the first time it has relinquished control of its core business in China after 26 years of operation [3][4]. Group 1: Market Competition - The competitive landscape of the Chinese coffee market has dramatically changed, with Luckin Coffee surpassing Starbucks in both store count and revenue, becoming the new market leader [5][7]. - In Q2 2023, Luckin's revenue exceeded Starbucks for the first time, with Luckin reporting 21.2 billion yuan in revenue and nearly 1.8 billion yuan in net profit for the first half of 2025, while Starbucks reported 18.2 billion yuan in revenue and approximately 1.2 billion yuan in net profit [7]. - Other local brands, such as Kudi Coffee, have also emerged rapidly, with Kudi opening over 14,000 stores since its establishment in 2022, intensifying the competitive pressure on Starbucks [5][7]. Group 2: Strategic Changes - In response to fierce competition, Starbucks has lowered prices on non-coffee products and enhanced promotions, with some drinks being offered at prices as low as 25 yuan, significantly below the original price of 35-40 yuan [8]. - Starbucks' performance showed signs of recovery in 2025, achieving a revenue of $831.6 million in Q4, a 6% year-on-year increase [8]. Group 3: Partnership with Boyu Capital - Boyu Capital acquired a 60% stake in Starbucks China for $4 billion, valuing the business at over $13 billion, indicating a strategic shift for Starbucks amid increasing competition [11]. - Boyu Capital is recognized for its extensive local resources and investment experience, particularly in the retail sector, which could accelerate Starbucks' expansion in China [12]. - The partnership is expected to lead to three major changes for Starbucks: accelerated store openings, more precise local operations, and improved supply chain efficiency [12]. Group 4: Expansion Plans - The new joint venture will manage approximately 8,000 existing Starbucks stores in China and aims to expand to 20,000 stores, surpassing the total number of Starbucks locations in North America [14]. - Starbucks plans to leverage Boyu's local market expertise to enhance its presence in smaller cities and emerging regions, with 183 new stores opened in Q4 2025 and entry into 47 new county-level markets [14]. Group 5: Balancing Act - Starbucks faces the challenge of balancing expansion with maintaining its premium brand image, as it aims to achieve the ambitious goal of 20,000 stores while ensuring quality service [15][16]. - The company must navigate the complexities of scaling operations while preserving the customer experience associated with its "third place" concept, which has traditionally relied on a direct ownership model [16]. - To achieve this balance, Starbucks is considering a multi-format approach, optimizing supply chain efficiency, and introducing localized products while maintaining brand integrity [16].